HostReadyA State Law Struck Down: What the Cortland Ruling Means for NY STR Operators
A Cortland County Supreme Court judge has declared New York's statewide Short-Term Rental registration statute, known as the SOID law, unconstitutional. The ruling, surfaced in a February 2026 landlord legal compliance update from Western New York law firm Friedman and Ranzenhofer, PC, is now under appeal, meaning the law's fate remains unresolved. For the roughly 12.625% combined lodging tax rate that Cortland STR operators already owe on every booking, nothing changes. But the constitutional challenge throws the county-level registry requirement, signed into state law in December 2024, into genuine legal limbo.
The Numbers
Every material data point for Cortland, NY short-term rental compliance is consolidated below.
| Data Point | Value |
|---|---|
| Combined lodging tax rate | 12.625% |
| New York State sales/lodging tax rate | 7.875% |
| Cortland County local tax rate | 4.75% |
| Tax filing frequency | Monthly |
| Minimum fine for non-compliance | $50 |
| Maximum fine for non-compliance | $100 |
| License required | Yes (County STR Registry, NY State Law) |
| Primary residence required | No |
| Owner occupancy required | No |
| Parking required | Yes |
| Enforcement level | Low (complaint-driven) |
| Airbnb collects lodging tax | Yes |
| VRBO collects lodging tax | Yes |
| Manual tax submission still required | Yes |
| STR activity permitted | Yes |
| NY State STR law signed | December 2024 |
| Ordinance reference | ecode360.com/29914430 |
| Market data last verified | May 25, 2026 |
The state sales tax threshold is notable: New York's sales tax applies to rentals priced above $2 per day, which effectively captures every active STR listing in Cortland County.
Regulatory Context
New York State has no blanket preemption of local STR ordinances, meaning counties and municipalities retain significant authority to layer rules on top of any state baseline. The statewide SOID registry law, signed in December 2024, directed counties to implement STR registration systems. Cortland County is in the process of implementing that registry, though the Cortland County Supreme Court ruling now clouds whether the state mandate itself can be enforced while the appeal is pending.
Cortland's current regulatory posture includes the following requirements:
- License: A County STR Registry registration is required before operating. The county is implementing this registry under the December 2024 state law.
- Tax: A combined 12.625% lodging tax applies, split between a 7.875% state rate and a 4.75% local county rate. Tax returns are due monthly.
- Parking: Off-street parking is required for STR properties.
- Primary residence or owner occupancy: Neither is required, making Cortland relatively permissive compared to markets like New York City, where Local Law 18 (effective 2023) imposes some of the strictest STR rules in the United States.
- Enforcement: Cortland's enforcement is classified as low and is largely complaint-driven. Fines range from $50 to $100, among the lowest penalty structures in New York State.
Both Airbnb and VRBO collect and remit lodging taxes on behalf of Cortland hosts. However, operators are still required to file their own monthly returns directly with the county, making manual submission an ongoing compliance obligation regardless of platform.
What Changed and Why
The trigger for this compliance event is a judicial ruling, not a new ordinance or a surge in enforcement complaints. The Cortland County Supreme Court found the New York SOID statute unconstitutional. The precise constitutional grounds cited in the ruling are not detailed in the available source material, but the decision is significant enough that it is now under appeal, suggesting the state or another party is contesting the outcome.
The broader legal environment for New York landlords and STR operators is unusually turbulent in 2026. According to the February 2026 compliance update from Friedman and Ranzenhofer, PC, New York landlord and tenant laws are changing frequently and can differ by county, city, and town. The firm's presenters, Robert Friedman (46 years representing landlords) and Justin Friedman (who leads the landlord litigation and evictions team in Western New York), emphasized that enforcement risk is real and that paperwork and timing mistakes are a common reason legal proceedings are dismissed or complicated.
Separately, the New York LLC Transparency Act, intended to disclose beneficial owners of LLCs to combat financial crimes, remains in flux. Federal Corporate Transparency Act enforcement is on hold after litigation, and New York's Department of State has not finalized implementation details. STR operators who hold properties through LLCs should monitor Department of State announcements for future owner-reporting duties.
What Operators Must Do Now
- Register with the Cortland County STR Registry. Despite the constitutional challenge, the registry requirement remains in effect unless and until a court order specifically enjoins enforcement. Contact Cortland County directly to obtain current registration requirements and forms, as the county is still in the implementation phase of the December 2024 state law. Operating without a registration is the fastest way to draw enforcement attention even in a low-enforcement market.
- File monthly lodging tax returns at the county tax portal. Submit returns at cortlandcountyny.gov/1118/Online-Tax-Records. Even though Airbnb and VRBO collect and remit the 12.625% combined tax on your behalf, you are still required to file your own monthly return. Missing a monthly filing is an independent compliance failure.
- Confirm your parking compliance. Cortland requires off-street parking for STR properties. Verify that your listing meets this requirement before your next guest arrival. There is no grace period specified in the ordinance.
- Monitor the SOID appeal closely. The Cortland County Supreme Court ruling is under appeal. If the appellate court reverses the lower court and reinstates the SOID statute, county registry requirements could be strengthened or accelerated. Set a calendar reminder to check for appellate decisions quarterly.
- Review your lease and disclosure documents if you also rent long-term. The 2026 compliance update from Friedman and Ranzenhofer specifically flags lead paint disclosure duties as a high-enforcement-risk area and notes that the 2019 Tenant Protection Act and the 2024 Good Cause Eviction law continue to generate new compliance obligations for New York landlords who operate both STR and long-term rental units.
- If your property is held in an LLC, monitor the New York LLC Transparency Act. New York's Department of State has not yet finalized implementation details, but future owner-reporting duties are expected. Consult legal counsel before those rules are finalized.
Bottom Line
The cost of full compliance in Cortland is low relative to most New York markets: a county registry fee (amount to be confirmed with the county), a 12.625% lodging tax that your booking platform already collects, a monthly tax filing that takes minutes, and a parking requirement. The cost of non-compliance is also low in absolute dollar terms, with fines capped at $100 per violation. But the Cortland County Supreme Court ruling introduces a layer of legal uncertainty that could shift quickly if the appellate court reinstates the SOID statute with stronger enforcement teeth. Operating without a registration today, even in a complaint-driven, low-enforcement county, is the single easiest way to become a test case in an environment where courts and regulators are actively scrutinizing the legal framework. The prudent move is to register now, file monthly, and watch the appeal.
For the complete Cortland compliance guide including tax calculator, checklist, and daily monitoring, see Cortland, NY STR Regulations.